BLBG:Oil Rises First Time in Three Days on Surge in Chinese Exports
Oil rose in New York for the first time in three days after China’s exports increased more than forecast in December, signaling growth in the world’s second- largest crude consumer.
West Texas Intermediate futures gained as much as 0.5 percent after China’s customs administration reported exports jumped by 14 percent in December from a year earlier, exceeding the 5 percent median forecast in a Bloomberg News survey. Imports climbed 6 percent after being unchanged the previous month. U.S. crude stockpiles were up 1.3 million barrels last week, Energy Department data showed yesterday.
“This will bode well for oil demand from the manufacturing sector” in China, said Gordon Kwan, the head of regional energy research for Mirae Assets Securities Ltd. in Hong Kong, who forecasts WTI could rise above $95 a barrel this week. “This reaffirms our view that China’s export-led economy has indeed staged a genuine turnaround.”
Crude for February delivery advanced as much as 43 cents to $93.53 a barrel in electronic trading on the New York Mercantile Exchange and was at $93.47 at 12:55 p.m. Singapore time. The contract settled at $93.10 yesterday, the lowest since Jan. 4. Prices lost 7.1 percent in 2012 after three years of gains.
Brent oil for February settlement on the London-based ICE Futures Europe exchange rose as much as 18 cents, or 0.2 percent, to $111.94 a barrel. The European benchmark crude was at a premium of $18.38 to WTI futures, down from $18.66 yesterday.
China Trade
A rebound in China’s trade may give policy makers more time to shift the economy toward domestic consumption to sustain expansion. Growth cooled to an estimated 13-year low in 2012 as Europe’s debt crisis crimped demand for Chinese goods.
“This is positive for commodities including oil demand,” said Jeremy Friesen, a commodity strategist at Societe Generale SA in Hong Kong. “We continue to see outperformance for China through the first quarter as this cyclical recovery continues, but improved external demand would add to this bullishness.”
Oil in New York has technical resistance along its 50-week moving average around $93.70 a barrel, according to data compiled by Bloomberg. Price advances have stalled near this indicator the past two days. Crude’s 14-day relative strength index also remains close to 70, a level that would signal further gains may not be sustainable.
Crude Stockpiles
Oil fell yesterday after the Energy Department report showed U.S. gasoline stockpiles climbed for a seventh week to 233 million barrels, the highest since February 2011. Supplies were projected to rise by 2.5 million barrels, according to the median estimate of 11 analysts surveyed by Bloomberg. Distillate inventories increased 6.8 million barrels, the most since May 1997, versus a forecast gain of 1.9 million.
Gasoline futures for February delivery in New York slid as much as 0.81 cents, or 0.3 percent, to $2.7708 a gallon. The contract declined 0.6 percent to settle at $2.7789 yesterday.
Crude stockpiles at Cushing, Oklahoma, the delivery point for the WTI contract, were up for a fifth week to a record 50 million barrels, according to the Energy Department’s data.
“Inventories have been elevated for some time,” said David Lennox, an analyst at Fat Prophets in Sydney. “There might be a modest recovery in demand in the U.S. China will put further pressure on the demand side this year.”
To contact the reporters on this story: Ben Sharples in Melbourne at bsharples@bloomberg.net; Ramsey Al-Rikabi in Singapore at ralrikabi@bloomberg.net
To contact the editor responsible for this story: Alexander Kwiatkowski at akwiatkowsk2@bloomberg.net
